Iraqis Elect Jalal Talabani Interim President

After two months of wrangling, Iraq's new government began to take shape Wednesday with the election of Kurdish leader Jalal Talabani (search) as the country's new president, and the promise to name another longtime foe of Saddam Hussein to the prime minister's post — all in a historic parliamentary session watched by the jailed former Iraqi dictator.

Talabani was elected to the largely ceremonial job of president — with Shiite Adel Abdul-Mahdi and interim President Ghazi al-Yawer, a Sunni Arab, as vice presidents — bringing Iraq a step closer to Iraq's first democratically elected government in 50 years.

U.S. President George W. Bush (search) called Wednesday's session a "momentous step forward in Iraq's transition to democracy."

"The Iraqi people have shown their commitment to democracy and we, in turn, are committed to Iraq," the president said in a statement. "We look forward to working with this new government, and we congratulate all Iraqis on this historic day."

Saddam and 11 of his top aides were given the choice of watching a tape of the session, and all chose to do so, Human Rights Minister Bakhtiar Amin (search) said. Saddam watched it by himself in his jail cell, and the others later watched it together.

"I imagine he was upset," Amin said. "He must have realized that the era of his government was over, and that there was no way he was returning to office."

Saddam, captured in December 2003, has been in custody with several of his top henchmen at a U.S.-guarded detention facility, believed to be near the Baghdad airport.

The so-called presidential council, made up of the president and his two deputies, will be sworn in Thursday. The three are then expected to immediately name the prime minister — likely Shiite leader Ibrahim al-Jaafari. That clears the way for a Cabinet to be chosen, and allows lawmakers to start drafting a permanent constitution, due Aug. 15.

Key issues — like whether to incorporate the oil rich city of Kirkuk into the autonomous Kurdish region, the role of Islam and who gets the Defense Ministry post — remain.

Officials said a new Cabinet might be named as early as Sunday, although they acknowledged the process could require more time.

Even as lawmakers made progress in forming a new government, there was confusion about the handover. Parliament speaker Hajim al-Hassani said members hoped that outgoing officials would act as a lame-duck government, running only the daily affairs.

Qassim Dawoud, Iraq's Minister of State for national security, explained that interim Prime Minister Ayad Allawi had already instructed the ministers to stop any long-term projects until the new government was completely formed and sworn in.

Though negotiators agreed on Talabani for the president's job weeks ago, news of his election was greeted with dancing and street celebrations in the Kurdish north.

"Today Jalal Talabani made it to the seat of power, while Saddam Hussein is sitting in jail," said Mohammed Saleh, a 42-year-old Kurd in Kirkuk. "Who would have thought!"

When the results were announced, legislators swarmed around Talabani, hugging and kissing him. Members gave him a standing ovation and tears welled up in the eyes of some Kurdish lawmakers and Talabani's relatives attending the session.

Talabani's election and the expected vote for al-Jaafari further consolidated the power shift in an Iraq, where both the Shiites and the Kurds were oppressed under Saddam.

While in power, Saddam's regime expelled Kurds from strategic areas in the north and gassed Kurdish towns, killing tens of thousands.

The mostly secular-minded Kurdish leaders are close allies of the United States and were strong proponents of the war to topple Saddam.

Talabani promised to represent all Iraqis as president and reached out to the country's different ethnic and religious groups as well to Iraq's Arab and Islamic neighbors. Al-Hassani, a Sunni Arab, declared: "This is the new Iraq."

"They elected a Kurdish citizen to be its president and the former Arab president is now his deputy," he said. "What else does the world want?"

Kurds make up about 20 percent of the nation's 26 million people, and won 75 of the 275 seats in parliament.

Sunni Arabs, who make up 15 to 20 percent of the population, have only 17 seats, largely because they boycotted the elections or stayed home out of fear of attacks. Lawmakers tried to reach out to Sunni Arabs, dominant under Saddam, by naming al-Yawer and al-Hassani to top posts.

But prominent Sunni Arab groups — whose members are believed to make up the backbone of the insurgency — distanced themselves from the new government.

"We are not related to any process in this matter of choosing candidates," Association of Muslim Scholars spokesman Muthana Harith al-Dhari told Al-Jazeera television.

World leaders congratulated Talabani on his post, with U.N. Secretary-General Kofi Annan welcoming "the commitment of Iraq's new leadership to working toward national unity through peaceful democratic means"

Turkish Foreign Minister Abdullah Gul told the Anatolia news agency: "I am sure that everyone's sense of being an Iraqi will be strengthened and the unity of the country will be strengthened."

Along with fellow neighbors Iran and Syria, Turkey had worried that the growing power of Iraq's Kurdish minority could inspire Iraqi Kurds to break away and embolden Kurdish minorities at home.

Speaking after his election, Talabani called on neighboring countries to help prevent foreign insurgents from crossing into the country. In an apparent bid to alienate foreign fighters, he reached out to Iraqis carrying out attacks that have left thousands dead.

"As for the Iraqis who are carrying weapons out of patriotic and anti-occupation motives, those people are our brothers and it is possible to talk with them and to reach a solution," Talabani said.

He added that his government would work to provide security so that U.S.-led coalition forces "could return home after the completion of building (Iraqi) armed forces that are capable of finishing off terrorism."

As parliament met, mortar rounds landed in the street across the Tigris River from where the session was being held. A blast left a crater near the Ministry of Agriculture and the al-Sadeer hotel and injured at least one Iraqi civilian. The target of the attack was unclear, but the hotel, which has housed foreign contractors, has been attacked in the past.

The National Assembly also agreed Wednesday to eventually move into a building that is currently being used by the Defense Ministry. The building, which is outside of the Green Zone, was used by the Iraqi parliament before the monarchy was overthrown.

It was not clear when the lawmakers would move into the building overlooking the Tigris River.

Also Wednesday, the U.S. military said in a statement that a Task Force Baghdad soldier was killed a day earlier when his patrol was hit by a bomb and attacked by insurgent gunmen.

And the Interior Ministry announced that 17 insurgents were killed in clashes in eastern Diyala province two days prior. One Iraqi soldier was killed and 11 others were injured in the shootout. The U.S. military had previously reported that two U.S. soldiers were killed in the same area.

A militant group, the Islamic Army in Iraq, purportedly posted an Internet statement saying it had released two Sudanese hostages abducted in Baghdad because they had "confirmed their true repentance to God." In an earlier video posted on the Internet, the men said they were drivers for a Turkish company working for U.S. forces.

The authenticity of the video could not be verified.